UK Watchdog Clears Microsoft-Mistral AI Deal

London, May 17 (AP) British regulators said Friday they don't need to open a competition investigation into Microsoft's partnership with French artificial intelligence company Mistral, a month after asking for industry feedback on the deal.

Microsoft announced earlier this year that it was partnering with the buzzy French startup in a move that could lessen the software giant's reliance on ChatGPT-maker OpenAI for supplying the next wave of chatbots and other generative AI products.

The Competion and Markets Authority said in a brief update that the tie-up “does not qualify for investigation" under UK merger rules.

The watchdog had said in April that it was seeking comments from “interested third parties,” before deciding whether to carry out an in-depth antitrust investigation.

By deciding not to probe the deal, "the CMA confirmed that the structure of the partnership between Mistral and Microsoft does not grant sufficient rights/influence to Microsoft," Alex Haffner, competition partner at UK law firm Fladgate, said by email.

The watchdog is still looking into Microsoft's hiring of key staff from another startup, Inflection AI, as well as Amazon's USD 4 billion investment in San Francisco-based Anthropic. It didn't provide updates on those reviews, which were announced at the same time last month.

Nor has it issued an update on its review of Microsoft's partnership with OpenAI since it asked for comments on that deal in December.